By CRAIG MAUGER
Michigan Campaign Finance Network
HARRISON TOWNSHIP (Aug. 16, 2019) — State law does little to reveal whether retiring lawmakers are taking donor-funded furniture, computers and phones along with them as term limits force them out of office.
A new joint investigation by the Michigan Campaign Finance Network (MCFN) and Fox 2 Detroit found that the campaigns of term-limited state senators have repeatedly disclosed making large purchases during senators’ final months in office with no explanation of where the items ended up once the lawmakers departed.
Former Sen. Jack Brandenburg, a Republican from Harrison Township, left the Senate at the end of 2018 after serving the maximum eight years. Over his first seven years in office, his campaign fundraising account reported spending just $2,364 on office furniture and decor.
During his final year in the Senate, however, Brandenburg’s campaign spent $3,108 on furniture and decor. That’s despite the fact that term limits barred him from continuing to campaign for the Senate.
Disclosures showed that on May 12, 2018 — eight months before he left office— Brandenburg’s campaign spent $2,861 at Art Van Furniture. Like others, Brandenburg and his campaign have declined to provide detailed answers about the expenditures. The Michigan Department of State hasn’t questioned the campaign about what happened with the furniture, and it appears to have little power to do so.
Shawn Starkey, a spokesman for the Department of State, said state law is “silent” on whether former lawmakers have to donate or purchase items that were originally funded by their campaigns.
During an in-person encounter, Brandenburg told a Fox 2 Detroit reporter, “I don't care about your questions.”
Brandenburg briefly noted that he previously had a district office and that the furniture was “at the office.” When it was mentioned that Brandenburg no longer had a district office — he left the Senate seven months before being asked about the furniture— he added that he was going to give the furniture to charity.
The situation highlights the mystery surrounding big spending by term-limited lawmakers who are barred from campaigning for re-election but still raise money from individuals and interest groups through campaign accounts. Brandenburg’s campaign had $84,468 available at the start of his final year in the Senate.
Senators who are elected to serve a second four-year term can’t run for a third term but they can raise money to support their political parties and to pay expenses directly related to their jobs as elected officeholders. They can also pay back loans they previously gave their campaigns.
State law allows them to use campaign donors’ money to pay for phones, computers and furniture that are needed to carry out their elected responsibilities. Things get murky when it comes to what happens to those items after lawmakers leave office.
Forty-one years ago, a township clerk specifically asked the Michigan Department of State, which is in charge of regulating campaign finance at the state level, whether a candidate could keep items purchased by his campaign for personal use after the campaign was over. The response provided little certainty: It said the law “does not expressly permit” the usage of campaign assets by a candidate for personal benefit.
Multiple campaign finance attorneys said they recommend former lawmakers' campaigns sell campaign-owned items at fair market values after lawmakers leave office. State campaign finance regulators have made similar suggestions in the past. But there’s little evidence of state regulators having the ability to oversee whether it’s happening.
At the federal level, things are clearer. Members of the U.S. Congress don’t face term limits but do face policies prohibiting them from using campaign funds for personal benefit. The Federal Election Commission, which regulates races for the U.S. House and U.S. Senate, says a campaign can transfer things it has purchased to the candidate personally only if the “transaction is made at the fair market value.”
MCFN and Fox 2 Detroit analyzed the campaign finance disclosures of dozens of former state lawmakers, including 30 state senators who left office because of term limits in 2014 or 2018.
The review found many instances of lawmakers’ campaigns spending more than $500 on items during the lawmakers’ final months in office and few instances of state regulators questioning the expenses. The following are some of the expenditures:
— Brandenburg served from 2011 through 2018. His campaign spent $2,861 on furniture on May 12, 2018, and $773 on a laptop on Aug. 16, 2018.
— Sen. Tom Casperson, a Republican from Escanaba, served from 2011 through 2018. His campaign spent $1,239 on “equipment” at Verizon on Nov. 15, 2018, $996 on “phone/equip” at Verizon on Nov. 30, 2018, and $1,001 on a computer on June 6, 2018. Casperson’s campaign didn’t immediately respond to requests for comment.
— Sen. Vincent Gregory, a Democrat from Southfield, served from 2011 through 2018. His campaign purchased a computer for $675 on Sept. 11, 2018. Gregory told Fox 2 Detroit that he used the laptop for campaign work and to file his final campaign finance disclosures in the summer of 2019 after he left office. Gregory said he has no plans to donate the laptop to charity because it still holds his political and campaign records and he uses it to keep in touch with people involved in politics and to correspond with former constituents.
— Sen. Roger Kahn, a Republican from Saginaw, served from 2007 through 2014. His campaign reported reimbursing Kahn $800 for “expenses” on Dec. 31, 2014, his final day in office. The campaign also spent $990 on “auto repairs” on June 3, 2014, $925 on “tickets” on June 3, 2014, and $855 on “framing for office” on May 14, 2014. Kahn’s campaign didn’t immediately respond to requests for comment.
— Sen. John Pappageorge, a Republican from Troy, served from 2007 through 2014. His campaign spent $3,556 on “office supplies” at Meijer on Oct. 24, 2014.
Of the above expenditures, Michigan campaign finance regulators questioned one, according to public filings: the $3,556 that Pappageorge’s campaign reported spending at Meijer less than three months before Pappageorge left office.
Michele Martin, an analyst for the Secretary of State, wrote to the Pappageorge campaign on Dec. 22, 2014, noting that items purchased by a committee are assets of the committee.
“These types of assets cannot just be retained by the candidate; they must be sold and/or donated,” Martin wrote.
In response, Pappageorge’s campaign treasurer said before the end of Pappageorge’s term, “… all resources were used by the committee.” There was no further discussion of the issue, according to public disclosures. Pappageorge’s campaign declined further comment.
State campaign finance regulators haven’t publicly questioned purchases made by Brandenburg’s campaign in 2018.
In addition to a laptop and furniture, Brandenburg’s campaign disclosed spending $247 on “office decor” on April 30, 2018, and $361 on a shredder and toner on Oct. 5, 2018.
The office furniture purchase from Art Van drew some questions from multiple campaign finance attorneys when they were told about it for this report.
In Michigan’s past, state lawmakers could use accounts called “officeholder expense funds” to pay for expenses related to doing their jobs in the Legislature. Administrative rules for those accounts required officeholders to purchase assets from the accounts at a “fair market value” once they left office if they wanted to keep the items. State lawmakers did away with "officeholder expense funds" in the 1990s, and many lawmakers now use either their campaign committees or other non-disclosing funds that fall completely outside of state campaign finance regulations to pay for officeholder-related expenses.
Attorney Eric Doster, who's written a book about Michigan campaign finance law, said it's not clear Brandenburg did anything wrong, but he said candidates should pay the fair market value to their campaigns for items that are no longer in use by their campaign committees.
Attorney Mark Brewer, former chair of the Michigan Democratic Party, told Fox 2 Detroit that current campaign finance law, which says little about what must happen with items owned by candidates’ campaigns, allows for the potential for abuse as “people walk out the door” to leave elected office.
The law could be changed, Brewer said, to require committees to produce an inventory of property and disclose what happened to it.